Augusta considers new use for former Kmart building as demand for self-storage rises

The former Kmart on Western Avenue in Augusta, seen on a recent Tuesday. Augusta councilors are considering a proposal to turn the vacant space into a self-storage facility. Joe Phelan/Kennebec Journal

AUGUSTA — An increasing demand for places to stow personal items and equipment is driving a proposal to convert the vacant former Kmart building, and its parking lot, on Western Avenue into self-storage space. The effort is part of a larger trend of repurposing large box stores that were driven out of business into storage facilities.

Several city councilors expressed enthusiasm about the concept of vacant and blighted former retail big-box space being put to a new, in-demand use, but most councilors were not receptive to parts of the specific proposal for the prominent Kmart site. Specifically, the developer’s plan to build several standalone, garage-style storage units in the parking lot, visible from Western Avenue and nearly within the shadow of the state Capitol complex.

Councilors, in a meeting earlier this month with representatives of the would-be developers, expressed interest in that reuse, which some said could also bring new life to other vacant former retail spots, including, on the other end of Western Avenue, the former Sears building at the Turnpike Mall.

“I appreciate the concept, I think repurposing these types of large box retail spaces — since retail is being done differently these days, thank you Amazon — is something that needs to be done,” said Ward 2 City Councilor Kevin Judkins, who is also a real estate broker. “It’s never going to return to what it was. So I take this as a big step up from what’s been sitting there for a while now. So I encourage it, I support it. But I would really like to see if it can be polished up a bit.”

Several councilors, even those who said they like the concept, objected to the developer Patriot Holdings’ plans to build several garage-style storage unit buildings in the parking lot between the 95,000-square-foot former Kmart building and Western Avenue.

“I love the concept of inside the old Kmart building; I think we need that kind of storage big time,” said At Large Councilor Heather Pouliot. “I just don’t understand (the parking lot units) part of it. I just feel that type of storage is better in different areas, not in a city. I just don’t think it fits with the neighborhood feel.”

Last year city councilors approved a zoning ordinance change to allow storage businesses as conditional uses in some commercial zoning districts along Western Avenue, where they weren’t previously allowed, including the area around the Turnpike Mall and Augusta Crossing shopping centers.

But the Kmart site is in a different zone, where storage businesses are not currently allowed, so the Las Vegas-based developers are seeking a contract zone agreement with the city to allow their storage business to locate at the site. Patriot Holdings operates about 45 self-storage facilities called All-Purpose Storage throughout New England, according to Brandon Mitchell of Malone Commercial Brokers, who represented the company in the meeting with councilors. The company sees the potential for growth in Augusta and elsewhere in Maine, where it also has self-storage projects in development in Buxton, Fairfield, Belgrade, Brewer and Warren.

Mitchell said the firm oversees construction and operations of all its own facilities and would build a high-quality, attractive project which would be well-maintained at the Kmart site.

“We kind of identified a need, that Augusta is lacking in self-storage,” Mitchell said. “We’re going to do major facade work, we’re going to make it look beautiful again. We’re very excited for the opportunity. This is what these guys do best, they take these old facilities and breathe new life into them.”

The rest of the strip mall would remain as retail space.

The proposed zone change — which the Planning Board unanimously recommended — to allow a storage business at the Kmart site was initially scheduled to go to councilors for a first reading May 19, but councilors tabled the proposal after the developer asked to delay its consideration so it could make changes to the proposal after hearing feedback from councilors. Multiple councilors expressed concern the garage-style storage buildings and a security fence proposed around them would be unattractive for passersby to view, and asked that they either be eliminated, reduced or better-screened.

Keith Luke, economic development director for the city, said the developers are working on changes to their proposal. The proposal could come back to councilors as soon as their next business meeting, Thursday.

Luke said the Augusta proposal follows a trend in the conversion of former retail space into storage space, part of a changing marketplace.

“The conversion of one-time retail space to self-storage is something that has been happening over the last decade, you don’t have to drive far from Interstate 95, anywhere from Augusta to Connecticut, to see that,” Luke said. “A wide variety of self-storage buildings were, at one time, retail. That’s not necessarily a bad thing. With the increase in rental units with one to two bedrooms, there are more places with minimal storage capacity. People move in with more stuff and they have to keep it somewhere.”

He said the question yet to be addressed in Augusta is whether the old Kmart site is a good spot for a storage unit business, especially so close to the state Capitol complex.

From 2010 to 2019, self-storage industry revenue increased nationwide by 49.4% reaching $39.5 billion in 2019, according to neighbor.com, a storage marketplace website. The industry operates at a 95% national average occupancy rate, meaning storage facilities typically have 5% of their overall space available for people to rent.

There were nearly 50,000 storage facilities in the United States in 2021, renting out a total of 1.9 billion square feet, according to the SpareFoot Storage Beat, an industry site which compiled a snapshot of the industry. The snapshot showed 10.6% of households rent a self-storage unit, at an average monthly cost of $89.12. In the 1990s only 1 in 17 Americans rented a self-storage unit.

A total of 43.9 million square feet of new storage space was built in 2021, with 49.9 million expected to be built in 2022, according to storagecafe.com, and 255.5 million square feet of storage space was built over the last five years, equivalent to 16.1% of the total inventory.

At Large City Councilor Abigail St. Valle said you can see urban storage facilities in many cities, including in Maine, and an increasing demand for such units in the state. She noted U-Haul already has a storage facility on its property just across Western Avenue from the Kmart mall site.

“I think it’s great a storage facility wants to come to Augusta, because if you go to any city, there’s tons of storage facilities,” she said during a recent council discussion of the issue. “New York City, every block there’s a storage facility. You go to Bangor, to Portland, you see storage facilities. So it’s great we’re getting something like that too, especially since we’re trying to get new people to come to the area. There needs to be some place they can put their stuff, when they’re trying to relocate.”

Robyn Wilbur, office manager for Guerrette Properties, which rents apartments but also oversees three self-storage facilities in the Augusta area with a total of about 400 units, said demand for storage seemed to climb when the coronavirus pandemic hit. She said they only have a handful of empty units to rent — the rest are in use. She said many current storage unit renters sold their homes and are living in apartments, and thus need more storage space for their stuff.

“The demand has been high, absolutely, it’s been that way for a while now,” Wilbur said. “Honestly, it’s almost like when the pandemic hit, people needed storage. I’m not sure why. We do get a lot of phone calls, from people who’ve sold their house and are moving into an apartment for the time being, because they can’t afford to buy another home right now. And they need a place to put their stuff.”

If the proposed contract zone to allow a storage business at the Kmart site is approved by councilors, the project would still be required to be reviewed by the Planning Board as a conditional use, a process which includes a public hearing.